Employment increases by 4.7 crore in FY23-24

India added 4.7 crore jobs across 27 sectors, reflecting a 6% growth rate as per Reserve Bank of India data in FY23-24. Government responses and contrasting reports underscore ongoing debates and initiatives addressing employment challenges amidst economic growth.

India added nearly 4.7 crore jobs in the fiscal year 2023-24, as reported by the Reserve Bank of India (RBI), surpassing earlier estimates. The employment growth rate for the year was 6%, up from 3.2% in 2022-23 across 27 industries, reflecting increased industry productivity.

In response to concerns raised by a recent Citigroup India report about job creation challenges despite 7% economic growth, the Ministry of Labour rebutted with data from the Periodic Labour Force Survey (PLFS) and RBI’s KLEMS. They cited the creation of over eight crore jobs from 2017-18 to 2021-22, averaging more than two crore jobs annually, attributing it to effective government initiatives.

The PLFS also reported a decline in unemployment from 6.0% in 2017-18 to 3.2% in 2022-23, indicating positive impacts of government policies. This official data presents a more optimistic outlook on India’s job market compared to private reports, highlighting reductions in unemployment despite global economic challenges, like the Covid-19 pandemic.

In December, the Ministry of Statistics and Programme Implementation (MoSPI) reported a promising increase in the Worker Population Ratio (WPR) for individuals aged 15 and above, rising from 52.9% in 2021-22 to 56.0% in 2022-23 which reaffirms the positive impact of key government initiatives aimed at boosting job creation and economic resilience.

Central to these efforts is the Aatmanirbhar Bharat Package, injecting a substantial fiscal stimulus exceeding Rupees Twenty Seven lakh crore to support businesses and mitigate pandemic-related challenges. Complementary schemes like the Aatmanirbhar Bharat Rojgar Yojana (ABRY) have incentivized employers to create new jobs and recover employment lost during the Covid-19 crisis, contributing significantly to employment recovery.

Despite of such growth, India’s unemployment rate saw an increase in April, 2024, rising from 7.4% in March to 8.1%. This uptick was observed both in urban and rural areas. Rural unemployment climbed from 7.1% to 7.8%, while urban unemployment rose more significantly from 8.1% to 8.7%. Accompanying the rise in unemployment, the labor participation rate (LPR) in India decreased marginally from 41.1% to 40.9%. The employment rate, which measures the proportion of employed individuals in the working-age population (15 years and above), also saw a decline, dropping from 38.1% to 37.6%. These indicators collectively highlight a challenging economic environment in and a further need for job growth for a bright economic outlook.